“Throughout history, it has been the inaction of those who could have acted; the indifference of those who should have known better; the silence of the voice of justice when it mattered most; that has made it possible for evil to triumph.”
Haile Selassie

Saturday, June 7, 2014

The Choice for the Republican Nomination for Indiana Treasurer? - Certainly NOT Marion Mayor Wayne Seybold

Marion Mayor Wayne Seybold

Republicans around the state have gathered in Fort Wayne (out of habit I started to type "Indianapolis") this weekend to holder their semi-annual state convention. This convention has two major issues before it - whether to keep in the platform support for an amendment defining marriage as between a man and a woman and the nomination of candidates for state treasurer.

﻿Three candidates are running: Marion Mayor and former Olympic gold medalist ice skater Wayne Seybold is seeking the nomination as is Richmond financial adviser Don Bates, Jr. and Kelly Mitchell, a top staffer in the Treasurer's Office. Most of the people I know and respect in Republican politics support Bates. The "issues" the Seybold people have tossed at Bates as disqualifying are as phony as a $3 bill. This included the claim when one media person declared that Bates' had undergone a "criminal investigation" with respect to matters relating to a civil lawsuit involving Bates' church because the prosecutor had looked at it and said there was no criminal laws broken.
﻿﻿The only legitimate conclusion that can be culled from the Bates' stories is that the man has had some financial problems. Given the news is filled with financial advisers who use their position to rip off their customers and make themselves fabulously wealthy, it's refreshing to meet a who clearly has not done that. Bates is clearly an honest financial adviser and that is exactly what we need overseeing the Treasurer's Office

I can't say anything bad about Kelly Mitchell, who works in the Treasurer's Office as Director of the Local Government Investment Pool. Some of my friends whose politics I trust wholeheartedly support her. But I think much of that is because they assume there is legitimate concern about Bates, when there is not. Mitchell may be a good candidate, but most people think the race is between Seybold and Bates.
﻿

Don Bates

Seybold's time as Mayor has left major concerns about his administrative judgment, his tin ear when it comes to conflicts of interest and the sharks who will likely have an open door to the taxpayers money if he is elected treasurer. Gary Welsh of Advance Indiana has done a great job of following Seybold's troubling and conflict-ridden mayoral moves, which stories were originally detailed by the Marion Chronicle-Tribune. From a May 26, 2014 Advance Indiana article written by Welsh:﻿﻿

The Marion Chronicle-Tribune exposes more transactions involving the use of tax increment finance district funds by the city that benefited businesses owned by the business partner of Mayor Wayne Seybold, who is seeking nomination at next month's state GOP convention for the office of state treasurer. In the latest disclosure, the Chronicle Tribune reveals two transactions where loans backed by TIF district revenues were made to two businesses, Western Place and Active Properties, both owned by Jim Swan. According to the newspaper report, Swan co-owns with Seybold a portable ice rink company, Ice Rinks 2 Go. Swan is also a member of the city's Board of Public Works and Safety, whose board members are appointed by the mayor. ﻿﻿

In December, 2008, city officials approved the use of $1 million in TIF loan proceeds for Western Place to make improvements to retail property that was later used for Moe's Southwest Grill and Culver's frozen custard franchise. The restaurant franchise is a partnership involving Swan and several other partners, while the Culver's is owned by Swan and another immediate family member....

The Chronicle-Tribune reports that although the original bond documents listed Swan's companies as the borrower responsible for repayment of the loan proceeds, the documents approved by the city's Redevelopment Commission, most of whose members are appointed by the mayor, pledged TIF revenues to repay the borrowed amounts. Swan's companies were only expected to repay loan proceeds to the extent TIF funds were inadequate to repay the bond debt. Swan defended the investment of the city's TIF funds in his businesses, noting their use for out-of-town interests. "If we're giving increment to people coming from out of town," he said, "I need that competitive (edge)."

The newspaper previously reported that Marion officials had provided $2.5 million in funding to a Korean businessman, Michael An, to redevelop a former YMCA building for a mixed use. Mayor Seybold's brother worked for a company that An established to redevelop the building. The City's building commissioner, Larry Oradat, also owned a construction company that performed work on the building. An's project later failed to come to fruition, and his property was ordered sold at a sheriff's sale after he failed to pay taxes on it. Oradat's construction company has filed a lawsuit against An's company for money it claims it is owed for construction work it performed on the building. The Chronicle-Tribune previously reported that city officials refinanced the debt owed on the YMCA project as part of a larger bond issue and relieved him of all liability for the $2.5 million in loan proceeds provided to him for his project. Marion city officials were unable to account for how over $2 million in bond proceeds issued to An were spent.

It turns out that the bond refinancing deal in 2009 for An's debt also included a refinancing of the prior bond proceeds that benefitted Swan's projects. Like An, Swan's businesses were released from any liability for repayment of the debt as part of the bonds issued to refinance the old debt. Swan told the newspaper that he was unaware that the debt had ben paid off until he got a letter saying that it was done to obtain a better interest rate for the city. The Chronicle-Tribune cites city council meeting minutes where the city's attorney, Barnes & Thornburg's Bruce Donaldson, had assured council members otherwise. "The city would not have any liability on it," Donaldson told council members at the time the TIF funds were approved in 2008 for Swan's Western Place. "If that (TIF) doesn't generate enough to pay them, then the company would be on the hook for the difference."

Kelly Mitchell

Unlike Bates, Seybold's travails are directly related to work he did as a public official. Seybold has demonstrated beyond doubt he has no concept of conflicts of interest and is more than willing to use the public's money to make his friends wealthy. Don't think for a second that Seybold's mistakes as Marion Mayor has caused him to reconsider the character and motives of those he surrounds himself with. One of Seybold's campaign chairs is Barnes & Thornburg partner, Bob Grand, who has made a fortune off of getting politicians to hire his law firm for overpriced, often shoddy legal work. Grand's secret to continuing getting legal work for his firm? He kicks back part of those legal fees to the politicians in the form of campaign contributions which then, of course, leads to more legal work. It's how pay-to-play operates in the legal world. Grand doesn't contribute money to candidates. He buys them and ones that allow themselves to be bought by Grand will undoubtedly do his bidding if elected.

Seybold's other campaign chair is Dan Dumezich, a Schererville (Lake County) Republican attorney who has practiced in Chicago and was a big supporter of former Senator Richard Lugar. While I've heard bad things about him, I haven't witnessed first hand his antics like I have Grand's.

While the obvious choice today for Treasurer is Don Bates, I fear the decision within a couple hours will be Wayne Seybold. It's hard to beat insiders, especially at a convention. Nonetheless, if Seybold does get the nomination, expect that will be the race the Democrats target to win in 2014. Seybold's substantial baggage could actually cause a Democrat to win that office.

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About Me

I have been an attorney since the Fall of 1987. I have worked in every branch of government, including a stint as a Deputy Attorney General, a clerk for a judge on the Indiana Court of Appeals, and I have worked three sessions at the Indiana State Senate.
During my time as a lawyer, I have worked not only in various government positions, but also in private practice as a trial attorney handing an assortment of mostly civil cases.
I have also been politically active and run this blog in an effort to add my voice to those calling for reform.